As part of the Cancun Agreement, reached on December 11 in Cancun, Mexico, at the 16th Conference of the Parties
(COP 16), Parties decided to establish a Standing Committee on Finance (SCF) to assist the COP in relation to the
Financial Mechanism of the Convention. The SCF is to assist the COP in exercising its functions with respect to the
Financial Mechanism of the Convention in terms of improving coherence and coordination in the delivery of climate
change financing, rationalization of the Financial Mechanism, mobilization of financial resources and measurement,
reporting and verification (MRV) of support provided to developing country Parties.

At COP 17, Parties further defined the roles and functions, as well as the composition and working modalities, of the
SCF. The SCFwill report and make recommendations to the COP, for its consideration, at each ordinary session of the
COP on all aspects of its work.

The SCF will assist the COP in exercising its functions with respect to the Financial Mechanism of the Convention
through activities, such as:

Organizing a forum for communication and continued exchange of information among bodies and entities dealing
with climate change finance in order to promote linkages and coherence;

Maintaining linkages with the Subsidiary Body for Implementation (SBI) and thematic bodies of the Convention;

Providing to the COP draft guidance for the operating entities of the Financial Mechanism of the Convention,
with a view to improving the consistency and practicality of such guidance, taking into account the annual reports
of the operating entities as well as submissions from Parties;

Making recommendations on how to improve the coherence, effectiveness and efficiency of the operating entities
of the Financial Mechanism;

Providing expert input, including through independent reviews and assessments, into the preparation and conduct
of the periodic reviews of the Financial Mechanism by the COP;

Preparing a biennial assessment, overview of climate finance flows, to include information on the geographical
and thematic balance of such flows, drawing on available sources of information, including national communications
and biennial reports of both developed and developing country Parties, information provided in the registry,
information provided by Parties on assessments of their needs, reports prepared by the operating entities of the
Financial Mechanism, and information available from other entities providing climate change finance;

Additionally, the SCF will perform any other functions that may be assigned to it by the COP.

The SCF will meet at least twice a year, or more if necessary. The COP will conduct a review of the functions
of the SCF in 2015.

At COP 19, the SCF was further invited at COP 19 to consider ways to increase its work on the MRV of support beyond
the biennial assessment
and overview of financial flows (BA). Furthermore, the SCF was
requested, in the context of the preparation of its BA, to consider ongoing technical work on
operational definitions of climate finance, including private finance mobilized by public interventions, to assess
how adaptation and mitigation needs can most effectively be met by climate finance. Additionally, the
SCF was also requested to consider, in its work on coherence and coordination, inter alia, the issue of financing for
forests, taking into account different policy approaches.

At COP 20, Parties welcomed the transparency and openness with which the SCF conducts its work and endorsed the
workplan of the SCF for 2015.
The SCF was also invited to further strengthen its engagement with all relevant stakeholders and bodies of the
Convention. With regards to the 2014 BA covering the period 2010–2012, the COP welcomed the progress achieved
by the SCF through its successful completion and noted with appreciation the 2014 BA
Report. The COP also invited the relevant bodies under the Convention to take note of the summary and
recommendations by the SCF on the 2014 BA and requested relevant technical bodies to consider the recommendations
contained in the report of the 2014 BA as part of their ongoing deliberations related to climate finance.

Furthermore, COP 20 requested the SCF, as part of its ongoing work on MRV of support, and with a view to
recommending improvements to the methodologies for reporting financial information, to consider the findings and
recommendations of the BA in its annual report to COP 21 for its consideration. Additionally, COP 20 requested the
SCF, in the context of its ongoing work, including the preparation of the BA, to further explore how it can enhance
its work on the MRV of support, based on best available information on the mobilization of various resources,
including private and alternative resources, through public interventions.

COP 20 also requested the SCF to include, in its report to COP 21, information on progress made in the
implementation of its 2015 workplan, taking into account paragraphs 4–7 of decision
-/CP.20 on methodologies for the reporting of financial information by Parties included in Annex I to the
Convention. The COP also requested the SCF to present an update on its work on this matter to the Subsidiary Body
for Scientific and Technological Advice for its consideration at its forty-third session.

Additionally, COP 20 expressed that Parties look forward to the third forum of the SCF, taking place in 2015, which
will focus on issues related to finance for forests and encouraged the SCF to continue to engage with all relevant
actors working on forests in the preparation of the forum, with a view to ensuring broad participation.
Furthermore, COP 20 invited the SCF to consider, in the context of its forum on issues related to finance for
forests, inter alia, decisions relevant to activities referred to in decision 1/CP.16, paragraph 70, including
decisions 1/CP.16, 2/CP.17 and 12/CP.17 as well as decisions 9/CP.19 to 15/CP.19.

With regards to guidance to the operating entities of the Financial Mechanism, COP 20 endorsed the recommendations
on the provision of guidance provided in paragraph 10 of the report of the SCF to COP 20
and requested the SCF to provide advice on the issue of the frequency of guidance to the Financial Mechanism and to
report back to the COP 21. Additionally, the COP requested the SCF to consider issues related to possible future
institutional linkages and relations between the Adaptation Fund and other institutions under the Convention.

The SCF was also requested to provide expert input to the sixth review of the Financial Mechanism in 2017 and was
encouraged to build on the same methodology and criteria it used for the expert input to the fifth review of the Financial
Mechanism.

Furthermore, the SCF was invited, along with other thematic bodies under the Convention, to consider the long-term
finance issues referred to in decision 3/CP.19, paragraph 12 when implementing its 2015-2016 workplans, as an
input to the in-session workshops referred to in paragraph 12 of decision
-/CP.20.